Why Using a Financial Planner for Retirement Is Just Smart
A financial planner is someone who has a specific set of knowledge related to helping you plan for your long-term financial goals. These individuals can analyze your present status and give you the guidance you need to plan for any major life event, including things like having a baby, buying a house, or even retiring. Here are some of the main reasons why it is always better to use a financial planner when it comes to your retirement.
#1 – Things Happen
Maybe you are in your 30s, you have a decent chunk of change in your 401k account, and you have a great job. Things may be going well right now, but what happens if you get laid off and you need money? Diving into that 401k is going to cost you a pretty penny in penalties, and you will essentially rob yourself of part of your retirement savings. A financial planner has the knowledge and expertise to help you allocate your savings wisely so that you can deal with these unexpected issues.
#2 – Economies Change
Let’s say that you want to retire with $150,000 in the bank. For most people, this is a reasonable goal and one that is perfectly attainable. However, take the time to consider the rate at which the economy changes. A gallon of milk may cost you $5 now, but what will it cost in 20, 30, or even 40 years when you are ready to retire? That $150,000 may not stretch as far as you had hoped, and you might find yourself in trouble. A financial planner can help you estimate cost of living increases and plan for these early.
#3 – Your Health Can Change
Many people start off strong when it comes to saving for retirement, but then a health crisis strikes and they find themselves in a bind. A professional, expert financial planner can work with you from the outset to help you allocate funds for a variety of situations – including long-term health issues. Even if you find yourself unable to work and the recipient of short-term disability benefits for a period of time, a good planner can help you make the most of those funds.
#4 – You Might Need to Identify Some Money Pits
Many people make more than enough money to save and invest in their retirements but seem to have trouble actually finding those funds when it comes to contributing to an IRA or other form of account. Financial planners excel mainly in one area – budgeting. They can help you determine where your money is going and what you should do to make sure it starts going to the right places. For instance, maybe you can cut back on your premium cable channels and put that $50 a month into an account. Over the course of 30 years, those savings alone add up to $18,000. Imagine the possibilities if you could find a few other cutbacks.
Many people truly believe that they have all of the knowledge and expertise it takes to plan for their own retirement. However, things and circumstances can change in the blink of an eye, and these are the times when having an expert financial planner on your side can make a tremendous difference.